LISBON, Portugal (AP)--The European Union
pledged continued backing Thursday for East Timor, ushering the territory
towards nationhood as part of a wider strategy to ensure political
stability in Indonesia.

The EU wants to steer East Timor, a
former Portuguese colony that was taken over by Indonesia, into becoming
"a democratic state which will contribute to peace in the
region," Portuguese Prime Minister Antonio Guterres said.

Guterres, whose country holds the EU's
rotating presidency, and other EU senior officials met with East Timorese
independence leader Jose Alexandre "Xanana" Gusmao on the
sidelines of an EU summit here.

The EU has granted EUR33.5 million to
East Timor for immediate humanitarian assistance since a majority of its
people voted last year to break away from Indonesia, which annexed the
territory by force in 1976. EU member nations have also made separate
contributions.

European Commission President Romano
Prodi said the EU intended to finance long-term investments to establish
permanent health care facilities and replace damaged infrastructure in
East Timor.

Pro-Indonesian militias backed by the
Indonesian military ran amok after the ballot. At least 250 people were
killed and much of East Timor's infrastructure was destroyed.

The United Nations is running the
territory until it is ready to hold democratic elections.

Gusmao cautioned that democracy in
Indonesia was still fragile and warned against pressing Jakarta too hard
on bringing senior military officers to trial for their part in the
post-ballot rampage.

Guterres said there was a risk East
Timor's development could be derailed by pro-Jakarta militia groups
attacking from bases in West Timor, the other half of the island.

However, he said he was convinced the
Indonesian government wanted to ensure stability in East Timor.

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